Will Republican Leadership Cut Loose USDA’s Tangled Catfish Inspection Role?

Philip Wegmann / June 20, 2016

Opponents have been swimming upstream for years in an effort to sink a federal catfish inspection program that they argue wastes millions of taxpayer dollars.

The Senate last month sent legislation to the House that would block the Agriculture Department from inspecting catfish. But three weeks later, the House’s Republican leadership has left that bill on the hook and hasn’t announced whether it will get a vote.

“We’re one step away from getting rid of the poster child of duplicative and wasteful programs here in Washington and doing the right thing for the American people,” said Rep. Vicky Hartzler, R-Mo., who is spearheading the effort. “It’s just a matter of bringing it up for a vote.”

At issue is which federal government agency regulates imported catfish, the ray-finned bottom-feeder that has become a deep- fried staple in the Deep South. The debate extends past congressional politics to food safety concerns and international trade consideration.

Traditionally the Food and Drug Administration regulates seafood while the Agriculture Department (USDA) inspects higher-risk foods such as foreign beef, pork, and poultry.

That changed in 2008 when Southern lawmakers, led by Sen. Thad Cochran, R-Miss., slipped a provision into the farm bill that charged the USDA with inspecting catfish from farms in and outside the U.S.

Because the switch won’t be implemented completely until 2017, FDA and USDA agencies at processing facilities in the U.S. are both regulating the same fish twice.

Though the switch won’t be implemented completely until next year,  plants in the U.S. that process both catfish and any other seafood would have to adhere to two regulatory regimes. The USDA would inspect catfish while the FDA would inspect all other seafood.

Under the USDA regulatory scheme, unlike the FDA system, foreign exporters must prove that their inspection systems are equivalent to American systems. That likely will prove a significant hurdle for catfish farmers in China and Vietnam who rely on American markets to unload most of their catch.

It’s been difficult for the USDA to pin down an exact cost for the program. To take over catfish inspections entirely, the USDA indicated it needs $30 million to set up the program. In fiscal 2013, the agency said it would take $14 million a year to operate. But a revised estimate in 2015 reduced that cost to $2.6 million a year. The FDA reports that it inspects catfish for about $700,000 annually.

That’s prompted the Government Accountability Office to recommend ending the USDA program before it comes fully online. In at least 10 different studies the GAO has concluded that cutting it loose “could save taxpayers millions of dollars.”

Multiple efforts to end the USDA program have floundered thanks to Southern senators with strong catfish industries in their states. But this year, led by Sen. John McCain, R-Az., opponents of the bill were able to avoid the Southern dragnet and pass a repeal resolution out of the Senate.

“Now it’s just up to the House,” Rep. Vicky Hartzler, R-Mo., told The Daily Signal.

On June 15, 180 lawmakers, including 52 Democrats, signed onto a letter authored by Hartzler urging leadership to bring the catfish resolution to the floor. Pointing to those numbers, Hartzler told The Daily Signal she’s confident it would pass.

Agriculture Chairman Mike Conaway, R-Texas, has organized a contingent of more than three dozen lawmakers to defend the USDA program, framing the debate as a public health issue.

To win, the Conaway contingent needs to convince leadership to disregard the Senate legislation. If Majority Leader Kevin McCarthy, R-Calif, who controls the House floor schedule, does nothing, the undoing of USDA would not get a vote.

Proponents argue that the USDA program is necessary to prevent imported fish contaminated by drugs, carcinogens, and formaldehyde from making it to American markets.

“From the standpoint of food safety it’s an absolute no-brainer: We can’t allow contaminated, adulterated products of any kind into this country,” said Rep. Rick Crawford, R-Ark., who chairs the Agriculture Committee’s risk management subcommittee.

“This is the United States. We have a pretty high standard for food safety that shouldn’t be compromised,” he told The Daily Signal.

Supporters of the Agriculture Department admit the agency spends more to inspect catfish than the FDA does. But they argue that the better-funded USDA does a superior job and inspects more fish. And to make their case, they point to polluted shipments of foreign catfish flagged by the USDA.

“Within two weeks,” Crawford said, “they stopped two adulterated shipments of catfish from Vietnam and then another two that were from China, who decided they couldn’t withstand the scrutiny so they turned around and left.”

In May, the USDA discovered two shipments of catfish from Vietnam that contained dyes and antibiotics chemicals; an agency spokesman told The Daily Signal those substances aren’t approved in fish meat meant for human consumption.

In a separate June incident, a ship returned to China with its catfish cargo rather than undergo USDA inspection.

But David Acheson doesn’t make much of those examples. Formerly the chief medical officer responsible for food safety at both the FDA and USDA, he described arguments in support of the USDA catfish program as “nonsense.”

“[The] regulatory difference between the USDA and FDA,” Acheson wrote in a Forbes article, “does not make the product safer, just more difficult to import.”

Overseas producers such as China and Vietnam will have 18 months to meet that benchmark before being cut out of the U.S. markets. But opponents protest. that the process can take anywhere from five to 20 years.

Gavin Gibbons, spokesman for the National Fisheries Institute, a trade group of seafood producers, says the process amounts to an indirect embargo.

“This is regulation by earmark wrapped in a fake food safety scare that in the end costs taxpayers,” he told The Daily Signal.

While foreign companies scrambled to adhere to the new inspection standards and apply for equivalence to U.S. practices, domestic catfish farmers would enjoy, at least temporarily, a market monopoly.

According to the Food Marketing Institute and the National Retail Federation, when the USDA inspection system goes online more than a fifth of the catfish supply will disappear.

That would result in a boom for domestic catfish farmers at the expense of foreign competitors.

Already, foreign nations have protested the proposed rule change. In a 2013 letter to U.S. Secretary of State John Kerry, Vietnam’s minister of foreign affairs warned that if the rule goes into place, “our government will have no choice but to consider available remedies.”

That means a trade war, warns James Bacchus, a former Florida representative and chairman of the World Trade Organization’s appellate body, which helps settle international commerce disputes.

In a June 14 letter to House Speaker Paul Ryan, Bacchus warned that foreign nations would take retaliatory actions.

If the U.S. doesn’t overturn the transition to USDA catfish inspections, he wrote, “it will truly be ‘open season’ in the rest of the world for new restrictions on U.S. agricultural exports of all kinds.”

This report has been modified to flesh out  cost estimates and to clarify USDA and FDA inspection responsibilities.